n
THE MORNING OREGONIAX, TUESDAY, 3IARCII 9, 1920
j
LATEST PHOTO OF NOTED ACTRESS AND HER SON, FOR WHOM
lllllllllimilllllllll!llllllllllllllllllllllllllfll IIIIIIIIIIIMIIIIIIIIIIIIIIII IllllllllrV
SHE CLAIMS SHARE OF $50,000,000 FIELD ESTATE.
TAX HELD ILLEGAL
Supreme Court Rules Stock
Rhode Island Calls Amend-
Dividends Untaxable.
j. I I x? L "r i x
mem violation oi nignis. - . mn Aitt,nrgt
EVEILLIONSOF
HOME
DRY ACT S ARGUED
SUPREME COURT
Y
NATION LOSES REVENUE
Thousands of Investors Expect Re
funds Wliere Securities Have
Hot Yet Been Sold.
WASHINGTON. March Corpora
tion dividends distributed as stock do
not constitute "income"" and are not
subject to federal income taxes, the
supreme court decided today in a
rive-to-four decision.
Provisions of the 1916 federal in
come tax law levying taxes on stock
dividends were declared unconstitu
tional. The decision also nullified
similar provisions of the present law
and will involve great loss In rev
enues to the government and refunds
of such taxes already collected. Large
financial interests will be affected
and numerous stock dividends of gen
rrous proportion are expected to be
declared soon.
In the majority decision by Justice
Pitney, Chief Justice White and Jus
tices McKenna, Van Devanter and
McReynolds concurred. Of the four
dissenting members. Justice Holmes
read a brief opinion in which he was
joined by Justice Day. and Justice
Brandcis delivered a lengthy opinion
In which Justice Clark concurred.
Stork Sale Could Be Taxed.
In holding stock distributions are
not dividends on account of no sep
' aration of. corporate assets being in
volved. Justice Pitney for the ma
jority declared stock shares "are
nothing except paper certificates in
distributed assets, are not realized
profits and, therefore, are not tax
able." The attempt of congress to tax
stock distributions, the majority de
cided to be unconstitutional and not
permitted by the 16th, or income tax,
constitutional amendment. Stock divi
dends, the majority held, may be
taxed only after stockholders realize
on them by sale, in which case
government may levy income
on such profits.
All four dissenting justices con
tended congress had power to tax
stock dividends, holding such divi
dends as "income," the same as if
"in cash. The 16th amendment, the
minority declared, is broad enough
to justify the tax.
Rote Held "Narrow Bod Blinrrf."
Justices Brandeis and Clarke char
acterized the majority view as "nar
row and bizarre" and said It would
permit many corporations to escape
taxation on much of what "is actu
ally their income." Declaration of
dividends in cash or in some other
medium, the two justices added, "is
wholly a matter of financial manage
ment" and therefore "if a dividend
paid In securities represents a distri
bution of profits congress may, of
course, tax it as income."
The other dissenting opinion ex
pressed the belief that the word "in
come" in the 16th amendment should
be read in a sense most obvious to
the common understanding at its
adoption. Most people, other than
lawyers. It was added, supposed when
they voted for It they put at rest the
question of direct taxes including
levies on stock dividends.
the
taxes
V - - : t 111
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f : i 1 JSf'l if. '-. I J
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If V - w i"3t
DANGER SEEN IN DOCTRINE
Photo Copyright by Underwood
PegBT Marnh and Henry Anthony Marsh, for whom she rlalma a share in (he
r0.00O,O0O Field estate. The suit Is now pending. This photo was taken
. in England, and has just arrived tn the Lnltrd State
5 to 10 points up. Hails were slow to
move, but rose spiritedly in the last
hour when word came that the rail
roads had won their valuation suit in
the supreme court over the interstate
commerce commission.
Jt is rumored that many corpora
tions who.se dividend policy had re
mained in abeyance pending, the tax
ruling will proceed to distribute prof
its gained during the lastjjfew years
among stockholders.
In the case of high-priced stocks
this is likely to take the form of a
splitting up of shares with "rights"
accompanying the recapitalization.
In other instances it is probable
increased or extra dividends will be
declared.
STOCK MARKET IX PAXIC
False Report Causes Flurry and
Sharp Recovery.
NEW YORK. March 8. Wall street
was thrown into a state of demorali-
zation today and many hundreds of
thousands of dollars were lost and
won within a few minutes when news
agencies which serve the district
misstated the decision of the United
States supreme court in the stock
tax case and declared stock dividends
were taxable.
The service of the Associated Press
was accurate in every particular.
After Us report reached the street
stocks which had broken 2 to 10
points under an avalanche of selling
orders, steadied and began to climb.
For the balance of the session prices
continued to strengthen, final quota
tions for leading shares making sub
stantial gains.
During the declines frightened trad
ers sold almost regardless of value.
The hundreds of thousands of dollars
they forfeited were captured on the
rebound by others who had refused
to sell on the strength of the first
and false reports or who were in
ignorance of what was happening.
General Motors, the star performer,
gained 15 points before noon, reacted
. 11 points on receipt of the erroneous
report and then rose to 301, a net gain
of 42 points.
Crucible Steel, another spectacular
feature, gained 30 points after hav
ing shown an actual loss of 10 points.
Many other industrial shares closed
GLASS OF SALTS
If Your Back Hurts or Blad
der Bothers You, Drink
Lots of Water.
When your kidneys hurt and your
back feels sore, don't get scared and
proceed to load your stomach with a
lot of drugs that excite the kidneys
and irritate the entire urinary tract
Keep your kidneys clean like you
keep your bowels clean, by flushing
them with a mild, harmless salts
which removes the body's urinous
waste and stimulates them to their
normal activity. The function of the
kidneys is to filter the blood. In 24
hours they strain from it 500 grains
of acid and waste, so we can readily
understand the vital importance of
keeping the kidneys active.
Drink lots of water you can't
drink too much; also get from any
pharmacist about four ounces of Jad
Salts; take a tablespoonful in a glass
of water before breakfast each morn
ing for a few days and your kidneys
will act fine. This famous salts is
made from the acid of grapes and
lemon juice, combined with lithia, and
has Veen used for generations to clean
and stimulate clogged kidneys; also
to neutralize the acids in urine so it
no longer is a source of irritation,
thus ending bladder weakness.
Jad Salts is inexpensive; cannot in
jure; makes a delightful effervescent
iithia-water drink which everyone
should take now and then to keep
their kidneys clean and active. Try
this, also keep up the water drinking,
and no -doubt you will wonder what
became of your kidney trouble and
backache. Adv.
OREGON "REDS" ON TRIAL
(Continued From First Page.)
lowed to end In the disorganization
of the ranks of organized labor. We
must help to keep the workers to
gether, and through rank and file
control of the unions assist the
process of uniting all workers in one
big union."
From the official organ of the so
ciety, the Communist Labor Party
News, was read a comment that the
socialist party was reactionary, that
it "has officials that openly voice
their hope that the Russian revolu
tion will not succeed because it did
not come by the 'ballot box route.' "
The paper refers to "our bolshevik
comrades" and declares that the party
it represents "deems the ballot box
campaigns for establishing the dic
tatorship of the proletariat of sec
ondary importance"
Propaganda Aim Revealed.
The communist labor party, it Is
learned from this source, "partici
pates in political campaigns for pur
pose of propaganda" only, and refers
to itself as a "party that is uncom
promising in its revolutionary tactics"
and one which has adopted as its of
ficial emblem 'the hammer and sickle
of the bolsheviks."
To the socialist, the following ad-1
vice is offered: "If you still have
faith in the palavering of politicians
and distrust the workers on the Jod
if you actually believe that the co
operative commonwealth will spring
full-orbed from that ballot-box; if
you are afraid to join hands openly
with the bolsheviks and the sparta-
eans in the third internationale, then
stav where you belong in the old
socialist party."
Under the heading, "wnats in a
Name?" the following article was read
to the jury: "Did you Know tnai
the official name of the bolsheviks,
the 'government party of soviet Kus
sia, is the communist labor party of
Russia? The communist labor party
of America is traveling in good com
pany, thank you."
Opening; Arument Conelndee!.
The Issue is whether or not men
with lawlessness In their mouths and
treason in their hearts may aeciare
open season on our constitution anu
the institutions which have grown up
under it. Tou are sitting here not
as employers of labor or as workers
but as God-fearing Americans to pass
judgment."
In these words, h.an c: oernara,
denutr district attorney, conciuaea
the opening argument of the prosecu
tion, yesterday morning.
John Reed, husband or me rormer
Louise Bryant and well known in
Portland, was given credit for an
active part in the organization of the
present communist labor party and
for being one ot tne leaaers oi tne
society today. Bernard sketched the
organization of the communist labor
party, which he held directly con
nected with the soviet of Russia, in
part as follows:
'The bolshevik government or kus-
sia called a congress of extreme radi
cals in Moscow, March 2 to March 6,
1919. at which was formulated a mani
festo to the proletariat of the world.
"By 'proletariat' they meant men who
had no property and wisnea to latce
property illegally from those who
had. In this manifesto there was a
call for a revolution to wipe out state
boundaries, to convert the world into
a co-operative communist society, and
to take property from owners without
compensation and illegally.
'A state of society in which family
had no place was advocated,, a state
which could not be brought about by
the ballot or present machinery of
government, but oy the seizure of
arms and ammunition, formation of
red armies and forcible establishment
of the 'dictatorship of the proletariat,'
knowing no law. but their own will
'This meeting adopted a programme
known as that of the communist In
ternationale or third Internationale,
to which the communist labor party
subscribes.
'Of recent years there has existed
in tbe socialist party of America b
extremely radical left wing, of which
John Jleed was the leader. At a con
vention in New York City in June,
1919, this left wing declared the main
body of the party reactionary in seek-
ings reform through the ballot ana
decided on the formation of the com
munist and the communist labor
party.
"The two parties are identical in
their aims. Some delegates from the
socialist left wing held a convention
in September, 1919, and organized the
communist party. Others attended
the socialist convention in Chicago in
October, where they were literally
kicked off the floor of the conven
tion. They then organized the com
munist labor party. Both stand for
the same thing and the communist
labor party is now attempting to unite
with the communist party. The only
difference is in control of the party.
"The communist labor party adopted
a platform and programme at Chicago
in which it was determined to adopt,
approve and affiliate with the com
munist internationale, saying that
the capitalists ana proletariat dif
fered beyond hope of compromise and
saying also that the present machin
ery of government must be abolished
by force. Craft unions were criticized
and the party approved and upheld
the I. W. W.
"The radical element ,!n the socialist
party in Oregon got busy under Joe
Laundy an I. W. W. organizer. State
and local charters have been issued.
The men on trial are: Claude Hurst,
local financial secretary; Fred W.
Fry, active member, and Karl W.
Oster, state secretary, organizer,
propagandist and agitator."
"Christ was an agitator, if you
remember," declared W. S. U'Ren, at
torney for the accused, in the open
ing statement for the defense. "That
is not a crime. The burden of proof
is on the prosecution.
Allegationi'Muit Be Proved.
"They probably will have no diffi
culty in proving membership, though
we admit nothing. But the teachings
of the organization are one thing they
must prove, which they cannot. They
cannot say that the communist labor
party is responsible for pamphlets
printed by hothead members, any
more than the republican or demo
cratic parties could be held sponsor
for the publications of wild-eyed re
publicans and rabid democrats.
"The allegations of the state must
be proved by official documents. If
it is proved that the party advocates
forcible overthrow of government and
that these men are members of the
party they are guilty under the law.
-we snau prove tnat tne commun
ist labor party relies on constitutional
and lawful methods to get control of
the government. As to their practi
cability, I have nothing to say. They
haven't got any further than beauti
ful dreams. There is no law against
dreaming. And I shall show that their
beautiful dreams do not propose to
violate the laws of Oregon or the
United States."
what you order" was the
reply of our new Chef
to a question by patron
in the restaurant
recently.
THAT'S the Spirit of things
here the Spirit of an
Washington, March s. The pro- Eacer-to-Serve Dolicv and an
"""""" ",ra'"u,raL l" Ah p-tn-Sprvp evnpripnPA that
constitution was assailed in supreme . , , e , . .
court today by Rhode Island as revo- gives yOU What yOU Want, the
way you want it, wnen you
want it, and at the reasonab.
legitimate addition to the pnce fljaf; y0U Want to pay.
Government Iefends Prohibition
as Legitimate Addition to
Xational Basic Law.
lutionary and defended by the govern
rights and defended by the govern
ment
nations basic law over which the
court held no jurisdiction. Throngs
attended the session,
H. A. Rice, attorney-general of
Rhode Island, opened for the opposi
tion, and W. L. Frierson, assistant attorney-general,
replied for the gov
ernment. Other arguments will be
heard tomorrow, as well as appeals
from Kentucky and Massachusetts.
jnr. liice charged there was a con
stitutional revolution through amend
ments.
"I see more danger in the doctrine
urged by the government than any
doctrine urged by the demagogues
during the world war," he said
"Rights assured the people under the
tenth amendment were never intend
ed to be taken away."
Justice Ciies Slavery Art
Mr. Rice argued that the prohibi
tion amendment resulted from a mis
conception of the law by congress and
that federal government had no au
thority to make such a change in the
constitution. He said the terms of
the prohibition amendment are out
side the purview of the constitution.
"What about the thirteenth amend
ment abolishing slavery?" inquired
Justice Pitney.
That was a compromise amend
ment and corrected an error in the
constitution," he answered
Justice BrandciSaskcd what power
could bring about the changes im
posed by the eighteenth amendment.
"There is no power in the constitu
tion to make such a change unless it
could be done by unanimous consent
of the states, and the people," Mr.
Rice al. "There is no power ' and
there was never intended to be such
power for encroachment by the fed
eral government upon the powers of
states.
Amendment Is Defended.
'Wasn't slavery supported by the
police powers of the states?" Justice
McReynolds asked.
'Yes," replied Mr. Rice, "but it was
a police power to regulate."
Mr. Rice said that the thirteenth
fourteenth and fifteenth amendments
were written into the constitution
by force."
Mr. Frierson argued . there was
nothing revolutionary in the adoption
of an amendment that lays down
fundamental rule of law" applying
to all states.
"The case does involve the question
as to whether a state can come Into
federal court and enjoin enforce
ment of a criminal law on the ground
the law is unconstitutional," he add
ed. "I have never understood this
court, at the instance of a state, couli
be constituted into a forum in which
to debate the respective political
rights of the two governments.
The court granted permission for
the filing of briefs by Charles Evans
Hughes on behalf of 24 states, and by
Wayne B. Wheeler, general counsel
for the Anti-Saloon league of Amer
ica, supporting the amendment, and
by Elihu Root, in opposition to the
amendment on behalf of the United
States Brewers' association.
Put us to the test for
steaks, for table d'hote
or for any specialty
any time in either
restaurant.
Hfmperial
named Northup In Portland, Or., in
1917, has had her marriage to Arthu
H. Shafer, a hotel clerk of this city.
nnulled. The woman told the court
that Shaefer forced her to wed after
two weeks' acquaintance by threaten
ing her with a revolver and a bottle
of acid.
FOREST POLICY INDORSED
Retail Lumbermen Ask Itcclama
tion of Western Lands.
BOISK, Idaho, March 8. (Special.)
The Western Retail Lumbermen'
association in Boise last week unanl
mously approved reforestation in th
national forest ara of the west an
the reclamation of arid lands.
The association aiso declared for th
formation of zones in various sec
Hons of the territory it covers, urged
the governors of western states an
representatives in congress from such
states to get behind the reforesta
tion plan; tne estaonsnment oi iieia
posts in the national forests; that th
stand taken by the "Save the Red
woods league" be indorsed; that sena
tors and representatives in congress
be urged to use their influence to se
cure the repeal of legislation imped
ing free use of the Panama canal
that the bill presented to congress by
the governors of western states for
the" reclamation of arid lands be
passed; that the proposed plan for the
education of foreigners and to ad
vance Americanism be put into force
and effect.
BAKER BANKS SHOW GAINS
Deposits of Institutions $3,966,154,
Resources $5,107,853.
BAKER, Or., March 8. (Special.)
The three local banking Institutions
report a total of resources and' de
posits very much greater than those
of the same period last year.
The First National .bank reports
$2,196,541.71 In deposits with a total
of $2,891,905.20 in resources. The Ba
ker Loand & Trust company has
$1,018,958.15 In deposits and $1,223,
148.24 in resources. The report of the
Citizens National bank shows $750.-
654.39 in deposits with a total of
$992,800.14 in resources. The grand
total in all the banks of Baker shows
$3,966,154.25 in deposits and $5,107,-
853.58 in resources.
GOVERNOR HART DEFIED
(Continued From First Page.)
requiring determination and it is an
nounced from Spokane that the "Black
Top" paving Interests will be here by
representations in one or both houses
to launch a fight against the Carlyon
road bill.
Fight Means Long Session.
Should this latter fight be made
with any show of strength, hopes for
a short session are extremely
shadowy.
With the vast number of bills be
ing held in abeyance, many under
protest because of the desire to limit
the sessions work, the action of the
state superintendent in refusing the
governor's urgent plea to defer the
educational conference until the leg
islature has opportunity to meet and
adjourn is likely to be used as the
wedge to open the way for a flood of
legislation. - . . j
VESSELS WILL BE SENT
Ships Promised to Be Available for
Orient Trade.
OREGONIAN NEWS BUREAU.
Washington, March 8. Ships needed
at Portland, Or., for trade with the
orient in the service of the Columbia-
Pacific Shipping company, will be
transferred from the Atlantic to the
Facific the moment they become avail
able, John Barton Payne, chairman
of the shipping board, assured Sen
ator McNary today. He said the ships
would be sent in ballast through the
canal without waiting for cargo.
A survey was promised for today
by Chairman Payne, after which he
said we might be able to give some
specific assurances as to how many
ships could be furnished and how
soon. Late today he said it had not
yet been possible to reach any defi
nite conclusion.
Filipino Asks Bar Admission,
SALEM, Or., March 8. (Special.)
Jose Mendoze Javier, Filipino attorney
of Portland, appeared personally be
fore Attorney-General Brown here to
day and asked for a legal opinion as
to whether he could be admitted to
practice law in Oregon upon a certifi
cate issued to him by the supreme
court of the Philippine islands. The
attorney-general said he did not be
lieve there was any statute in Ore
gon covering the case at issue, and
that he probably would refer the mat
ter to the supreme court of this state
for consideration.
Cascades Sawmill to Start Vp.
STEVENSON, Wash., March 8.
(Spcial.) The Donovan-Dubois Lum
ber company which recently purchased
the plant at Cascades formerly op
erated by the Fir Lumber company
has had a number of men repairing
and overhauling the machinery and
logging roads for the past three weeks
EVERETT HAS 11.3 GAIN
Census Figures Show Contrast Be
tween Coast and Iowa.
WASHINGTON. March 8. Popula
tion statistics for 1920 announced to
day by the census bureau included:
Everett, Wash., 27,614, an increase
of 2800, or 11.3 per cent; and Ottum-
wa. Ia.. 23,003, an increase of 991, or
4.5 per cent over. 1910.
figg Shipments to Be Halted. '
SAN FRANCISCO, March 8. Two of
the larget shippers of eggs In Cali
fornia have announced that their east
ern shipments will cease in the next
few days because of fear of a break in
the New York market. .
Former Portl-ander Gets Divorce.
SAN FRANCISCO, March 8. (Spe
cial.) Mrs. Luella Marie Shaefer,
who says she was married to a man
'Cfte-ShirtWith
Cbmfbrt Points
wearing comfort" m
Continuous facing
on cuffs prevents
tearing
There's real work
manship, ss well as
4
tu A i
ecru ttttomei cruris
!5PU.OOM81NAnONOFSTYlANDOOrffO(?r
KeepYbur Eyes
Clean i e r-ieairnyF
Baby Shunned
Because of Eczema!
John II. Shooting, 601 Maia St. Uncsjtsr,
Ohio, writes:
"My baby boy contracted a serem eaij
of Eczema, which covered hn face and
bead. Viaiton to our home would ihun
my child becsnae be looked so terrible.
I procured a bottle of D. D. D. In an in
credibly short time bst boy was cured.
Thouiandi of letters from rratefol naers ot
HDD prere its wonderful reiulta ia healin
tortarinr .kindiieaae. The very nnt applica
tion ellayi the itchiac sod burning Whr not
tar a bottle at once and be eoniiaeed? Your
Sooeyback if the rrt bottle does not bring
t.t.VH and 81.00. Try P.D.D. Seep, too.
mxinxin).
m. Iottori for SWn Disease
OWI. DRFG CO.
6IUD1I0EJS uava CO.
- j,-
. Ill
It Washes Faster
It Washes More Gently
A Fine, Well-Built
Machine
That's the foundation of the great enthusiasm of Apex users
and its national popularity. That's why there is such a tre
mendous demand for
APEX
ELECTRIC WASHERS
Discriminating women delight in its shining copper tub always
sweet smelling and sanitary may be kept so without effort.
No wood and no parts to lift out and clean. Nothing to wear the
clothes. '
The Apex has never been
equaled, because it is the
original oscillating machine.
Designed eleven years ago
and protected by exclusive
patents.
SIMPLEX Ironers
Our professional
, demonstrator
will show you
how to get more
service from the
Simnlex than
you ever dreamed possible.
IT WILL PAY YOU
SEE THE APEX
$140
TO
Buy Electric Goods From an Efeclric Slorc
J. C. ENGLISH CO.
UPSTAIRS AT 148 FIFTH ST, BET. MORRISON AND ALDER
PHONE: MAIN 143
.iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiimiiiiiimimnrimiiiiiiiii iiiiiiimiimmmmmm
J
r
and expects to beg-in operating the
mill this week. The mill has a
capacity of, 60,000 feet daily.
Linn Fair Plans Buildings.
ALBANY, Or., March 8. (Special.)
Plans are being prepared for
complete set of buildings on the new
Linn county fair grounds at this city.
A big pavilion for the agricultural,
horticultural and educational exhibits
will be constructed, and this struc
ture may contain an auditorium for
Good
for
Clothes1
Men
Quality is the keynote in
the new spring suits we are
showing.
The selection is large, both
in fabric and model the
finest woolens are here repre
sented. Highly skilled tailors
have contributed the thorough
workmanship which makes
these suits worthy the Mathis
label.
Featuring suits from
$40 to $75
Others at $30 and up to $97.50
Mathis
for
Quality
New Spring Hats
$6 to $20
AmKis
MEN'S WEAR
Mathis Corner
Fifth and Morrison
P
C i' -"I
If
Knitted
Silk Ties
Here They Are
Just in
Beautiful new pattern ef
fects in a wide range of
colors that will appeal to
you strongly. Exceptional
quality at
$1.50
meeting. Five or six other build
Ings will be erected to house the
exhibits of stock and poultry. A ra
track will be constructed and th
buildings will be erected so as to
leave room for various special fihib
Its and attraction
i -
, . - J.